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A two-leg options strategy that bets on a big move in either direction, cheaper to enter than a Long Straddle in exchange for needing a bigger move to profit.

A Long Strangle combines buying one out-of-the-money put and buying one out-of-the-money call, at two different strikes, same expiry. Both premiums are paid upfront. If the underlying makes a large enough move in either direction, one leg gains enough to more than cover the cost of both. It's the exact opposite of a Short Strangle — buying instead of selling both legs.

Using out-of-the-money strikes instead of a single at-the-money strike (as a Long Straddle does) makes this cheaper to enter — less premium paid overall — but it also means the underlying needs to move further before either leg has real value, so the breakevens sit further from the current price.

Like a Long Straddle, profit depends on how far the underlying moves, not which direction — but the safe zone in the middle is wider:

1. Between the two strikes — maximum loss. Both options expire worthless, and you lose the full premium paid.
2. Moving beyond either strike — the corresponding option starts gaining intrinsic value, and losses shrink.
3. Beyond either breakeven — a real profit, growing the further the underlying moves.

A Long Strangle fits the same view as a Long Straddle — a large move, direction uncertain — but for a lower cost, in exchange for needing a bigger move to actually profit. It's a reasonable choice when a trader wants big-move exposure but finds a Long Straddle's cost too high relative to how large a move they realistically expect.

Suppose Nifty is trading at 24,000 with a weekly expiry coming up, and lot size is 65. Same setup as the Short Strangle example, using the same strikes.

1. Confirm the setup. You expect a significant move, direction uncertain.
2. Buy 1 put at the 23,600 strike, paying a premium of 45.
3. Buy 1 call at the 24,400 strike, paying a premium of 48.
4. Calculate the net debit: 45 + 48 = 93 points, or ₹6,045 at this lot size — your maximum possible loss.
5. Calculate the breakevens: 23,600 − 93 = 23,507, and 24,400 + 93 = 24,493.
6. Hold the position while waiting to see how large a move actually happens.
7. See how it resolves at expiry:
   • Nifty finishes between 23,600 and 24,400 → both options expire worthless, you lose the full ₹6,045 debit.
   • Nifty finishes at either breakeven → you exactly break even.
   • Nifty finishes at 25,000 or 23,000 → a real profit, growing the further past the breakeven it goes.

Quick reference for the same trade:

Based on the worked example above. Compare this to the Short Strangle page's diagram, built on the same two strikes — they're mirror images across the horizontal axis. Move the cursor over the chart to see profit/loss at any price.

• Time decay works against this position, same as a Long Straddle — every day without a large move erodes both legs' value.
• The flat, wide loss zone between the two strikes means a modest move that would help a Long Straddle may still land inside this strategy's loss zone.
• An implied volatility drop can hurt even on a correct directional call, same risk a Long Straddle carries.
• Index options on NSE are typically European-style and cash-settled — settled automatically at expiry.